E-commerce retailers shift focus to order value amid rising ad costs

E-commerce merchants in the UK and France are facing rising digital advertising costs, with paid traffic expenses on platforms like Google Ads and Meta increasing by approximately 15-20% annually. As customer acquisition costs on TikTok Shop and Instagram have nearly doubled since 2023, retailers are shifting their focus from increasing traffic to maximizing average order value (AOV).

To protect margins against rising fulfillment and advertising costs, UK retailers are increasingly utilizing strategies such as product bundling and volume discounts. Bundling allows brands to increase the number of items per shipment, thereby improving the efficiency of shipping costs.

In the French market, the demand for specialized Google Ads agencies is high, reflected by significant search volumes and high costs per click. Businesses are weighing the decision to internalize advertising management or delegate to agencies to optimize decision-making and campaign performance.